The OCC has issued guidance saying that the agency will favorably consider banks’ requests for up to a two-year transition period to comply with the Dodd-Frank Act’s Section 716—the so-called “swaps pushout” provision.
The provision prohibits banks that are designated as swap entities from using the federal assistance they receive—such as federal deposit insurance or access to the discount window—to support certain swaps activities.
“Each request must be written and specify the transition period appropriate to the institution, up to a two-year transition period commencing from July 16,” the provision’s effective date, the OCC guidance said.
The transition requests, among other things, must outline how the institution plans to comply with the new restrictions, and also how a “transition period would mitigate adverse effects on mortgage lending, small business lending, job creation and capital formation.”
Banks must submit the written requests Jan. 31.